This error related to a lack of space remaining on the device. There was 4GB left from a 32GB provisioned device but it seemed that the Office install didn’t like that. A quick reconfiguration of the disk space to 60GB solved the problem.

Hi – Are you deploying Office 365 as an application or did you create it as a package? I would like to test Office 365 deployment in a test lab on virtual machine. I have successfully deployed Office 2016 in test and production. Worked out fine. The company will eventually go for Office 365 in the near future.

Having a good understanding of deploying Office 365 will come handy down the road and your error will go into my KB article for future reference in case, I face same error on VDI machines.